Global Food Prices Surge to Multi-Year Highs, Threatening Israeli Supermarkets
The FAO international food price index surged in September to its highest level since late 2022, threatening to drive up grocery prices in import-dependent Israel.
Global price hikes threaten to hit Israeli supermarket chains soon: The FAO international food price index climbed to 136 points in September, the highest level since November 2022. This represents a 1.5% increase compared to August and a 5.8% surge year-on-year.
The trend is driven by the sugar index, which jumped by 6.1%, and the cereals index, which rose by 5.1%, alongside a slight increase in vegetable oils (0.9%). These spikes are attributed to ongoing disruptions in shipping routes in the Black Sea and the Strait of Hormuz, adverse weather conditions, and constrained supply forecasts in India, Thailand, and Brazil. Conversely, slight decreases were recorded in the meat (-1.1%) and dairy (-0.1%) indices.
For Israel, which relies on imports for about 98% of its grain consumption (roughly 5.4 million tons annually), this is a worrying development. The rising cost of feed wheat is expected to put pressure on local meat, egg, and dairy prices, despite the global decline in those sectors. This figure joins an ongoing trend: since 2018, Israel's food index has risen by 22.8%, at a significantly faster pace than the general index (18.9%).
FAO Chief Economist Maximo Torero warns that the pressures will soon trickle down to the shelves. In a country almost entirely dependent on food and energy imports, this warning is expected to soon manifest in every family's monthly bill.
